‘New tax law’ll affect workers’ living standards’

Workers are in for hard times, going by the provisions of the newly amended Personal Income Tax Allowance (PITA).

In the amendments, employees are required to pay taxes on certain allowances in which they have enjoyed full relief. These include leave bonus , housing and medical, among other allowances, provided for employees in both private and government establishments.

Speaking at a seminar on taxation in Lagos over the weekend, a partner at Emmanuel Ijiwere & Co, a tax and financial audit firm, Emmanuel Adeleke, said the amended personal income tax allowance Act, passed by the NationalAssembly, would affect the standard of living of workers.

Adeleke said leave bonus that is not more than 10 per cent of annual basic salary, is now taxable under the new Personal Income Tax Allowance (PITA) guidelines, adding that the development would further affect workers’ living standards. He said medical expenses incurred by staff outside the National Health Insurance Scheme (NHIS) and workers’housing allowance that is not more than N150,000, are going to be taxed. He said the grey areas in the amended PITA would certainly affect the living conditions of Nigerians.

According to him, the relief provided by the amended personal income tax would not be of help to workers.

“Both the workers in the lower, medium and higher income brackets, would be affected by the amended personal income tax allowance Act. There is a Consolidated Relief of N200, 000 or one per cent of gross income for workers in the new amendments. But that cannot cushion the effects of the economy on an average Nigerian worker,” he added.

Also, a principal partner, Babatunde Rufai & Co, Mr Tunder Rufai, said the new amendment was a sharp improvement on the old ones. He said legal issues contained in the new amendments must be resolved in the interest of people that are in taxable bracket. He said the portions affecting the welfare of workers need to be look into to foster growth.